Swallen dubbed the overall ad expansion a "feel good headline," but suggested that some serious, systemic issues remain with demand for some major media, which he said have lost as much as one-fifth of their total volume over the past two years.
Generally speaking, he was referring to print, especially locally focused print media like newspapers, which have seen an ongoing exodus of advertising budgets following the migration of consumer usage to digital alternatives. The recession only seems to have exacerbated that trend, and print is the only major medium that is not benefiting directly from the recovery.
In fact, Swallen noted that local newspaper ad spending has declined for "21 consecutive quarters." And the downward demand isn't just affecting the volume of local newspaper advertising, but its value as well. Swallen noted that while there was actually a "small uptick" if the volume of local newspaper space sold last year, total ad dollars fell 4.6%, meaning advertisers paid a lower price on average to place ads in local newspapers.
While national newspaper ad spending rose a modest 2.7%, Swallen said that was due primarily to category expansion - primarily additional editions published by News Corp.'s The Wall Street Journal, a publishing company that also is hedging its bets by pushing hard to get into the "tablet" publishing marketplace with The Daily.
Consumer magazines were the next least vital ad medium. While they expanded a modest 3.3% during 2010, their overall ad revenues are still below 2008 levels.
The media that have benefited most from the economic expansion has been television and the Internet, Swallen said. Some of it was due to cyclical spending patterns among key categories, like the 24.2% surge in spot TV advertising that was attributed largely to biennial political advertising spending. But key categories, especially telecommunications, consumer packaged goods, and a revitalized automotive industry, have been upping their TV ad budgets as well.
Swallen said that financial services advertising has also rebounded from its recessionary pullback, including debt-related categories such as credit cards and consumer loans, and that only two of the top 10 overall ad categories - direct response and pharmaceutical - experienced a contraction in 2010.
Interestingly, most of the grown in the U.S. ad expansion did not come from the nation's leading advertisers, but from mid-size and so-called "long-tail" advertisers.
While the overall marketplace expanded 6.5%, the top 10 advertisers boosted their spending only 3.7%. The top 100 advertisers expanded 8.8% and long-tail advertisers outside the top 100 expanded their spending 7.0%.
Historically, Swallen says long-tail advertisers are an important indicator to keep an eye on in terms of underlying economic vitality, because they tend to be closer-to-the-vest and more susceptible to economic volatility than big advertisers.
Percent Change in Measured Ad Spending1
· Media Type
(Listed in rank order of 2010 spending)
2010 vs. 2009
· Network TV
· Cable TV2
· Spot TV3
· Spanish Language TV4
· Syndication – National
· Consumer Magazines
· B-to-B Magazines
· Sunday Magazines
· Local Magazines
· Spanish Language Magazines
· Local Newspapers
· National Newspapers
· Spanish Language
INTERNET (display ads only) 7
· Local Radio
· National Spot Radio
· Network Radio
Source: Kantar Media
1. Figures tabulated from Kantar Media’s Stradegy™ application and cover all measured media, including: Network TV (6 networks); Spot TV (125 DMAs); Cable TV (67 English language networks); Syndication TV; Spanish Language TV (4 Hispanic broadcast networks; 4 Hispanic cable networks; 71 Hispanic local TV stations); Consumer Magazines (226 publications);Sunday Magazines (87 publications); Local Magazines (27 publications); Hispanic Magazines (14 publications); Business-to-Business Magazines (277 publications); Local Newspapers (147 publications); National Newspapers (3 publications); Hispanic Newspapers (48 publications); Network Radio (5 networks); National Spot Radio (205 markets); Local Radio (32 markets); Internet (1,883 sites); and Outdoor. Figures do not include public service announcements (PSA) or House ads.